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ELRCPartially AllowedNot stated in the judgment· [2023] KEELRC 3127 (KLR)

Okoth v Meditest Diagnostic Services Limited (Cause E410 of 2022) [2023] KEELRC 3127 (KLR)

Employment and Labour Relations Court
17 November 2023
AJAbuodha Nelson Jorum
3,186 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~13 min to read original · ~4 min brief

The bottom line

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A Kenyan employer lost an unfair termination case because it had no hearing, no valid reason, and handed the employee her contract only on her last day.

What this practically means

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Executive summary

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The claimant, employed as an Executive Assistant to the Chief Executive Officer from about 18 August 2021 at Kshs 135,120.50 monthly, was terminated on 21 March 2022 without notice, without a hearing, and was handed a written employment contract only on the day of termination, which she signed under pressure to secure her dues. She sued for declarations, notice pay, unpaid salary, twelve months' compensation, unpaid leave and a certificate of service. The respondent justified the dismissal as gross misconduct, alleging the claimant signed company board resolutions without authority appointing a third party as director, endangering the company, and said it gave her opportunities to explain including recording a DCI statement. The court framed two issues: fairness of reason and procedure, and entitlement to reliefs. It found the alleged authorising director was never called to rebut the claimant's testimony that she signed on his instructions, leaving her evidence uncontroverted; that issuing the contract only at termination was unfair labour practice; and that the termination letter wrongly invoked a clause of a contract never issued. There was no show cause letter, disciplinary hearing or opportunity for representations, and the DCI letter did not refer to the claimant. The court held the employer failed to discharge its statutory burden under sections 43 and 47(5), rendering the termination unfair in both reason and procedure. It awarded notice pay, unpaid leave, one month's unpaid salary, six months' compensation (not twelve, given less than a year of service), costs, interest, and a certificate of service, subject to statutory deductions.

Key legal issues

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01

Whether termination was for a fair reason

Holding

No valid and fair reason was proved; the director who allegedly did not authorise the signing was not called to rebut the claimant's evidence

Reasoning

The respondent alleged the claimant signed board resolutions without authority. The claimant testified she signed on the director's instructions. The director never testified, leaving the claimant's evidence uncontroverted. The dismissal relied on a contract clause in a contract never issued to her. Substantive justification therefore failed.

p. 5
02

Whether the termination procedure was fair

Holding

Procedure was unfair; no show cause letter, hearing, or opportunity to make representations was given

Reasoning

Under section 41 of the Employment Act the employee must be explained the reasons and heard. The respondent relied on a DCI statement and verbal warnings, but no disciplinary hearing or show cause letter existed, the DCI letter did not refer to the claimant, and no police officer was called. The legal burden under section 47(5) was not discharged.

p. 6
03

Failure to issue a written contract

Holding

Issuing the contract on the date of termination was unfair labour practice and the claimant was not bound by its terms

Reasoning

The claimant was employed in August 2021 but only received a written, backdated contract on 21 March 2022 upon termination. The Employment Act obliges the employer to issue a contract within a reasonable time. The termination letter invoked clause 21.1.9 of that contract, which could not bind her.

p. 5

Legal principles established

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  • The employer bears the burden of proving valid and fair reasons for termination and procedural fairness, failing which termination is unfair
  • An employee cannot be bound by the terms of an employment contract never issued to them
  • Summary dismissal for gross misconduct still requires proof of reasons and a hearing

Court orders

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  1. 1.Three months' salary in lieu of notice of Kshs 405,361.50
  2. 2.Unpaid leave days of Kshs 72,000.00
  3. 3.One month's unpaid salary of Kshs 135,120.50
  4. 4.Six months' salary for unfair termination of Kshs 810,723.00
  5. 5.Awards subject to taxes and statutory deductions but to attract interest at court rates from date of judgment until payment in full
  6. 6.Respondent to pay costs of the suit
  7. 7.Respondent to issue the Claimant with a certificate of service
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act; Article 41, 47 of the Constitution referenced)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Okoth v Meditest Diagnostic Services Limited (Cause E410 of 2022) [2023] KEELRC 3127 (KLR)", Case Analysis (2023). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/3127/eng@2023-11-17

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.